Word of mouth (WOM):  “the most disruptive force in marketing” (Bughin, Doogan, and Vetvik, 2010).

THE IMPORTANCE OF WORD OF MOUTH:

Why is WOM so important you ask? WOM drives a high impact and degree of credibility among consumers. Around “58 percent of consumers ascribe high credibility to the information they hear from others during WOM conversations” and 50 percent claim they are likely to buy as a result of these conversations. (Keller and Fay. 2012)

With shopping being a top 10 conversation topic, featuring in more than half of our daily conversations; it’s no wonder that the concept of WOM is climbing (Skole 2014).

SOME STATS:

• In 2013 68% claimed that they would trust consumer opinions online, up 7 percentage points from 2007 (Nielsen 2013);  indicating the growing impact of eWOM. 
• 72% increase their trust in the business after reading positive customer reviews (Anderson 2014).

• On social media, 58% of consumers actively share their positive experiences with a company, and ask family and friends for their opinions on brands (SDL 2013).
• 84% of consumers reported always or sometimes taking action based on personal recommendations. 70% said they did the same of online consumer opinions (Nielsen, 2013)

See more statistics like this on WOM marketing…

ADVANTAGES:

• Word of Mouth has been proven to increase marketing effectiveness up to 54% (Jankowski, 2013).
• Pure WOM is free, companies don’t tend to pay happy customers who share their experience with others (Kokemuller, 2015). Therefore it pays off to take care in delivering the best possible service/products and to take pride in having good customer service skills. Sometimes an incentive is offered to an existing customer to recommend someone, but here the cost is only incurred should you acquire a new customer; so in theory its still a win – win situation.
• A huge advantage is market efficiency. Often money is wasted when ad campaigns shown on the TV or internet, reach audiences who would never be interested in the product/ service (Kokemuller, 2015). Whereas, say a Facebook user posts about how much they enjoyed your product, it is likely that the majority of the people it will reach will be likeminded people who will also enjoy your product.
• Trusov compliments WOM by estimating “that WOM referrals have substantially longer carryover effects than traditional marketing actions and produce substantially higher response elasticities.” (Trusov, 2009)

For a full list of advantages please see here…

EVERY CLOUD HAS A SILVER LINING…

WOM can be both face to face and online. The main drawback to WOM is that as the business you can not control it. If you have an unhappy customer who is determined to share their experience with everyone they come face to face with, there really isn’t anything you can do about it. HOWEVER, eWOM on the other hand is a different story! Liu (2006) argues that both negative and positive WOM increase performance. Lets say you have an unhappy customer who shares their negative experience on Facebook for everyone to see, you could seize this as an opportunity to showcase your excellent customer service skills; therefore turning the negative into a positive. Arguably, this makes eWOM safer and more beneficial than face to face WOM as it gives the Company a chance to be involved with both the positive and negative comments.

SOUNDS GREAT! HOW DO I ACHIEVE IT?

Like we already know it is hard to control word-of-mouth therefore it is only right that you assume it is just as hard to create it. Nonetheless here are 6 key pointers to put you on the road to achieving a successful WOM campaign…

1. Start with the consumer – “The consumer is the centre of the economic universe” (Mourdoukoutas & Siomkos, 2009) – words to live and die by. To be a product or service that spreads like an epidemic, it needs to fulfil consumer need and desire. For example, Red Bull have satisfied the need for quick energy drinks. (Taran, 2012). If you want your customers to talk about how much they love you, give them a reason to – provide great customer service and always put them first.
2. Be innovative – this must be simple for the consumer and provide observable benefits. Innovation enhancements should follow and it should come with low risk of adoption and ease of trial. (Taran, 2012)
3. Target the right audience – based on their attitudes consumers can be classified as innovators, early adopters, early majority and late majority and laggards. The company must be able to cross the chasm between the early adopters and the crowd following early majority. Although innovators help create a market niche they cannot help the product reach the mass market. (Taran, 2012) Therefore, targeting the right group is essential to your product reaching the mass market.
4. Get the message right – the message needs to be appealing, transparent, credible and direct. It is better to stick to characters and stories that consumers can easily memorise, allowing them to recall the moment they make their purchase decisions. It may be necessary to shift the message focus as the product gains acceptance by new groups – i.e. for innovators the message should focus on the newness; for early adopters the focus should be on quality; early majority are likely to respond to brand reliability. The late majority need a message tailored to the simplicity and convenience of the product while the focus should be on price discounts when targeting laggards.
5. The right context is key – the right social context and time to let the innovators and early adopters spread the message. Your message must reflect the changes in context. The message would have to be visible and have a large population density in which people frequently interact; for example Facebook is home to millions of users however due to its generation cycle would be more appropriate to target a middle aged audience than say twitter and Instagram which also has millions of users, however mainly from the younger generation.
6. Ready for take off.. Launch eWOM campaign – identify consumers who are effective in influencing others, those who are likely to invite their friends to share your message. Potentially offer something in return for sharing their experience with you and your message on Facebook, tagging you in it. However remember that WOM can be hard to monitor and even harder to reverse and it is important to be aware that often WOM campaigns fail to connect. Monitor consumer relations and interactions and try to spread your message across the chasms, do this by building communities on social media, sending out hints about business or product updates (Miller, 2015).

WHO HAS DONE IT RIGHT?

Now I’m sure you probably heard of ‘The Ice Bucket Challenge’… this is a WOM campaign in its finest form and ALS Association had this going viral within a matter of days!

A QUICK RECAP…

eWOM is increasingly becoming more and more important to companies and good eWOM is possibly the best marketing campaign that a company can have, particularly if it is a small local business. Statistics for the impact that WOM has on consumers is on the up and rising. There are many benefits to it and as previously stated it is the opinion of some that there is no such thing as bad WOM (Liu 2006). Word-of-mouth is hard to control and just as hard to create; but remember if your going to have any chance of that you need your customers to love you.

REFERENCES:

Anderson, M. (2014). Local Consumer Review Survey 2014. Available: http://www.brightlocal.com/2014/07/01/local-consumer-review-survey-2014/. Last accessed 18th April 2015.

Bughin, J., J. Doogan, and O. J. Vetvik. “A New Way to Measure Word-of-Mouth Marketing.” McKinsey Quarterly, April (2010). Retrieved September 27, 2012, from http://w w w .mckinseyquarterly.com/ A_new _w ay_to_measure_w ord-of- mouth_marketing_2567.

Jankowski, P. (2013). Quick: What Are They Saying About Your Brand?.Available: http://www.forbes.com/sites/pauljankowski/2013/02/27/quick-what-are-they-saying-about-your-brand/. Last accessed 17th April 2015.

Kokemuller, N. (2015). The Advantages of Word-of-Mouth Marketing.Available: http://yourbusiness.azcentral.com/advantages-wordofmouth-marketing-1941.html. Last accessed 19th April 2015.

Keller and Fay. (2012). Word-of-Mouth Advocacy: A New Key to Advertising Effectiveness. Journal of Advertising Research. 52 (4), 1-7.

Liu, Yong (2006), “Word of Mouth for Movies: Its Dynamics and Impact on Box Office Revenue,” Journal of Marketing, 70 (July), 74–89.

Mourdoukoutas & Siomkos (2009). The Seven Principles of WOM and Buzz Marketing: Crossing the Tipping Point. Berlin: Springer. 9.

Miller, K. (2015). 5 Keys to a Successful Word of Mouth Marketing Campaign. Available: http://hireinfluence.com/all/5-keys-successful-word-mouth-marketing-campaign/. Last accessed 17th April 2015.

Nielsen. (2013). UNDER THE INFLUENCE: CONSUMER TRUST IN ADVERTISING. Available: http://www.nielsen.com/us/en/insights/news/2013/under-the-influence-consumer-trust-in-advertising.html. Last accessed 18th April 2015.

SDL. (2013). SDL Survey Reveals Consumers Want Brands to Offer Consistent Experience. Available: http://www.sdl.com/about/news-media/press/2013/sdl-survey-reveals-consumers-want-brands-to-offer-consistent-experience.html. Last accessed 17th April 2015.

Skole, J. (2014). 40+ Word of Mouth Statistics. Available: http://blog.getambassador.com/word-of-mouth-marketing-statistics/. Last accessed 18th April 2015.

Taran, Z. (2012). The Seven Principles of WOM and Buzz Marketing: Crossing the Tipping Point. Journal of Consumer Marketing. Vol. 29 (2), 163 – 164.

Trusov, Bucklin, Pauwels. (2009). Effects of word-of-mouth versus traditional marketing: findings from an Internet social networking site. Journal of marketing,. 73 (5), 90-102.